after calculating its dollar cost of forward hedging, mullen is now considering a money market hedge on the 300,000 pound payable. in particular, mullen can earn 5.00% over the next year by depositing pounds in a british bank today. suppose that the spot rate for the pound today is $1.18. in order to have 300,000 euros in one year, mullen would only need to deposit approximately pounds. in order to get that amount of pounds, assuming a spot rate for the pound of $1.18, mullen would only need approximately .
